Regional free trade agreements (FTAs), such as the EU-Singapore (EUSFTA) or the EU-Canada Comprehensive Economic and Trade Agreement (CETA), foresee judicial mechanisms for investor state dispute settlement (ISDS). The EU Treaties (TEU and TFEU) remain silent on the competence nature of external institution-building. It is no surprise therefore that ISDS causes inter-institutional disputes. Constitutionality reviews at national and EU level are challenged by ISDS institution-building. Examples are the German constitutional court’s 2016 decisions on CETA and its investment court system (ICS), and the Court of Justice of the European Union’s (CJEU) Opinion 2/15 on the EU-Singapore agreement.
This article looks both at the national and supranational constitutional courts of a multilevel composite adjudication system of relevance to EU external relations, with a particular focus on ISDS. After some general considerations on Member State courts’ influences on EU external activities, the article compares the double-layered (competence and substance) review-approaches at both levels, to then analyse the recent application of these approaches to the Singapore agreement and CETA. The aim is to show that in external relations, as elsewhere, the EU depends on system-internal cooperation between its constitutional courts. As this is particularly important for institution-building, the article will also point to some legal uncertainties which these courts generate for ISDS.European Foreign Affairs Review